The Emerging Economics of IoT
Insights into Successful Application of the Internet of Things
As with every major technological sea change, the emergence of the Internet of Things (IoT) has occasioned both widespread success and widespread failure. The enthusiasm with which entrepreneurs, investors, and governments have embraced IoT is a testament to its profound social and economic potential. In many cases, however, enthusiasm has outpaced understanding. As a result, the emerging IoT industry has been rife with the kinds of miscalculations and misapplications that often plague early adoption.
As IoT moves past its infancy, however, certain trends and economic realities are becoming increasingly clear. The most significant of these revelations is that traditional hardware business models do not readily apply to IoT technologies. This is due primarily to the fact that IoT devices carry recurring, infrastructure-related costs that don’t apply to traditional hardware. As a result, IoT technologies only prove truly advantageous when their application results in recurring, continuous value for the customer. This paper reviews the main use cases that result in such continuous value - including Compliance Monitoring, Preventative Maintenance, Remote Diagnostics, Asset Tracking, Automatic Fulfillment, and Premium Consumer Upsell.